Will crowdfunding disrupt the Venture Capital investing model in the US?
Richard Swart, PhD replied:
In short, no. Evidence globally shows that crowdfunding exists alongside other traditional forms of capital formation. Crowdfund Investing can supplement or replace the friends and family/seed round (RegCF), act as Seed/Seed+/Angel Round (RegCF or Title II), or even replace a public offering under $50mm (Regulation A+). However, for firms that are in the limited range of venture interest - easily scalable, TAM of at least $500mm/year, the ability of a Venture Firm to bring rapid additional cycles of financing will often require firms to continue using VCs.
Anonymous
asked
Richard Swart, PhD
Richard Swart, PhD replied:
In short, no. Evidence globally shows that crowdfunding exists alongside other traditional forms of capital formation. Crowdfund Investing can supplement or replace the friends and family/seed round (RegCF), act as Seed/Seed+/Angel Round (RegCF or Title II), or even replace a public offering under $50mm (Regulation A+). However, for firms that are in the limited range of venture interest - easily scalable, TAM of at least $500mm/year, the ability of a Venture Firm to bring rapid additional cycles of financing will often require firms to continue using VCs.